debt discharge; bankruptcy

What Will Happen if Your Debt Discharge is Revoked?

By Derek Prosser

When you file for bankruptcy, you may be able to receive additional time to pay back your creditors or have your unsecured debt fully discharged. While it’s great news to learn that your debt has been discharged, it doesn’t mean that the bankruptcy court can’t revoke its decision. If your debt discharge were revoked, it would require you to pay your debts once again. Here’s what will happen if your debt discharge is revoked after filing for bankruptcy. 

Who Can Revoke Your Debt Discharge?

An entity can request that your debt discharge be revoked if it is either the bankruptcy trustee for your case, a creditor, or another party with a financial stake in your claim. This entity must request the discharge revocation within one year of the date that your case was either closed or you received your discharge. This depends upon whether you filed for Chapter 13 or Chapter 7 bankruptcy respectively.

There are various reasons as to why a party would request that your discharge be revoked. These reasons more often than not are related to either attempted fraud or misrepresentation on your application when you filed. 

Reasons for Discharge Revocation

Chapter 7 Bankruptcy

For someone who has been awarded Chapter 7 bankruptcy, your discharge may be revoked if you engaged in one of the following:

  • You didn’t disclose all of your non-exempt assets;
  • You didn’t provide all required paperwork when submitting to a bankruptcy audit;
  • You failed to follow court orders;
  • You committed fraud on your bankruptcy claim (found after your discharge was issued); or
  • You made a material misrepresentation on your application

Chapter 13 Bankruptcy

A discharge revocation is more easily acquired for someone under Chapter 13 bankruptcy than it is for someone under Chapter 7 bankruptcy. This is because all a creditor or interested party is required to do is to show that:

  1. You committed fraud on your bankruptcy application in order to receive a debt discharge; and
  2. The interested party didn’t know about the fraud until the bankruptcy court had already given you the discharge.

Toronjo & Prosser Law Helps Those Who Are Dealing with Bankruptcy

It’s undoubtedly stressful to realize that you don’t have enough money, and even more stressful when you realize that filing for bankruptcy may be your best option. That’s why it’s so important to consult with a knowledgeable and experienced Dallas bankruptcy attorney. At Toronjo & Prosser, our qualified Texas Bankruptcy Attorneys can help you to navigate the process. To learn more or to schedule a free consultation contact us online or call us today!

About the Author
Derek Prosser understands that clients need help and need answers and that in order to properly address those concerns, clients need to deal with an attorney first and always, not just an assistant or paralegal.  By effectively counseling from the outset of a case, Toronjo & Prosser Law can anticipate and address potential problems before they arise, as opposed to when they’ve already surfaced (the “Counsel Later” approach), and, in the end, strive for a seamless representation.